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"Inquiry to Focus on Royalty Rates for Oil Shale Program"

"The Interior Department said Tuesday that it would investigate a decision made by the Bush administration to grant low royalty rates for oil shale development in the Rocky Mountains.

Ken Salazar, the secretary of the interior, expressed 'serious concerns' about changes made without public notice to six leases on Jan. 15. He asked the department’s inspector general, Mary Kendall, to look into the matter.

The announcement came as Mr. Salazar said he would resume a research program for oil shale development on federal lands in Colorado, Wyoming and Utah. Mr. Salazar had frozen oil shale developments within weeks of his appointment last February, saying more research was needed into the technology.

The investigation will focus on a decision taken by the Interior Department in the final days of the Bush administration to lock in a royalty rate of only 5 percent on 30,000 acres of existing oil shale leases for oil companies, Mr. Salazar said. By comparison, royalty rates, which are payments to the government for the right to operate, in the Gulf of Mexico are 16.7 percent."